Why one 'Magnificent 7' stock hasn't gotten crushed

Yahoo Finance
03-11

Amid a broader market meltdown that has rocked the foundation of the often popular "Magnificent Seven" trade, shares of one key component have avoided falling off a cliff. 

That is Mark Zuckerberg's Meta (META).

Meta's stock is the only Magnificent Seven member to be up in 2025, notching a minuscule gain. One could argue that gain isn't so insignificant when stacking it up with other Mag 7 members — all of which are down for the year. 

Apple (AAPL) is off by 9% year to date, Microsoft (MSFT) 10%, Amazon (AMZN) 11%, Google (GOOG) 12%, Nvidia (NVDA) 20%, and Tesla (TSLA) a stunning 45%. 

"Meta is not impacted by tariffs and has no China exposure," Wedbush tech analyst Dan Ives told me.

Watch: Gap CEO is monitoring tariffs every hour

To Ives's point, the Mag 7 is littered with companies overly exposed to the geopolitical risks hammering the go-to investing complex for retail and institutional investors. 

Tesla counts on China as an important sales outlet, while Amazon's third-party sellers source cheap goods from the country. And a macroeconomic slowdown that could happen due to Trump tariffs may lead to businesses buying Nvidia chips at a more measured pace in 2025.

Ives added, "Meta has become a defensive tech name in this Trump jigsaw puzzle."

To be sure, it could be much uglier for Meta at the moment.

The Dow Jones Industrial Average (^DJI) slumped 890 points, or about 2.1%, on Monday. The S&P 500 (^GSPC) fell by 2.7%, while the tech-heavy Nasdaq Composite (^IXIC) shed 4%.

The Roundhill Magnificent Seven ETF (MAGS) tanked 5.2%, its largest one-day drop since July 24. Tesla crashed 20% on the session. 

Year to date, the MAGS ETF is down 16%.

All three major stock indexes are off by more than 5% in the past month, with the Nasdaq Composite leading the way with an 11% plunge. 

Also helping sentiment on Meta is that it had a strong fourth quarter, unlike several of its Mag 7 rivals (see Tesla).

Earnings and revenue easily beat analysts' estimates. Profits were up 50% from a year ago.

Meta's app family (Instagram, Facebook, and WhatsApp) saw sales improve by about $7 billion year over year. The business also added close to $7 billion in operating profits.

Pros say Meta's investments in new technologies are juicing its performance at a critical time

"They're analyzing more instances of when you scroll up and down the feed, where do you stop, where do you stall, where do you scroll faster? And they're using more data points to essentially improve the relevancy of all the content that their users see by daypart," Morgan Stanley managing director Brian Nowak told me on Yahoo Finance's Opening Bid podcast.

Listen: Why this toy CEO is worried about tariffs

Added Nowak, "And then they're able to also take that data and use it on the advertising side and determine are you more likely to click on ads in the morning when you're catching up from the night's news? Or is it are you more likely to click on ads in the evening when you're scrolling through your daily catch up or your sports?"

Brian Sozzi is Yahoo Finance's Executive Editor. Follow Sozzi on X @BrianSozzi, Instagram, and LinkedIn. Tips on stories? Email brian.sozzi@yahoofinance.com.

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